Ebay integrity at risk

January 30th, 2005

Looked at any G5 auctions recently? All dodgy, full spec G5’s with a bank transfer only payment, no pickup…

It has been a bad few days for eBay. Last week more than $12bn (£6.4bn) was wiped off the value of the dotcom auction house as it warned that its financial performance for 2005 is unlikely to live up to bullish expectations.

Now discontent is growing among its big traders, who are dismayed with recent price rises imposed by ebaby and alarmed about the reputation of the online marketplace.

The Professional eBay Sellers Alliance ( PESA) – a trade group for business merchants operating on eBay – reckon that the “integrity of the eBay marketplace is the single largest issue challenging their businesses on eBay”.

PESA represents “600 high-volume eBay sellers representing a wide variety of goods and services, PESA members currently generate over seventy million eBay transactions each year and over $1bn in annual eBay gross merchandise volume”. It is worried that “negative buyer experiences and the associated media coverage have created a strong caveat emptor mentality among shoppers when considering browsing eBay”.

A quick trawl of news stories in recent weeks reveals the PR problem facing eBay. Illegal items such as drugs and weapons can be sourced with little effort. Stolen – or non existent – goods are also up for sale, although eBay buyers often only find out to their cost when it’s too late.

Last year the British Museum called on eBay to pull listings for ancient artefacts after it warned that hundreds of items – which should be assessed first under the Treasure Act – were being offered for sale via the auction outfit.

One of the most damaging stories to hit eBay recently came after a judge sentenced a Leicester woman for flogging non-existent tickets to the Glastonbury music festival. Sentencing the former payroll clerk, Judge Richard Bray said: “There may be certain safeguards that I have not been told about, but that appears to be the case and you took advantage of that. These trusting people, they get on the internet and they ask for a ticket and they send a cheque without any knowledge of who they are sending it to. Provided you don’t have fraud against you on eBay, you are all right as a fraudster. You can get on and sell anything you like.”

Stories of fraud and illicit items may make some punters wary, but there is another issue that is causing concern. Whether real or perceived, there was at one time a sense that you could pick up a bargain on eBay. Unfortunately, the chances of that happening appear to be diminishing. As one eBay veteran told El Reg he’s been caught up in auctions on a number of occasions only to find that he’d paid over the odds for goods. Experiences like that have dented his enthusiasm for eBay.

What’s more, there are genuine concerns that eBay doesn’t seem to be acting to address the issues. Late last year eBay users in Spain threatened to boycott the service unless the company addressed their concerns. In the UK, eBay regulars are just as bothered at the way the operation is heading.

PESA stated: “We believe that eBay needs to implement policies that will prevent people with negative intentions from doing excessive damage to innocent shoppers. eBay should verify the address and identity of sellers as well as place restrictions on selling activity until certain criteria are met. A new seller should not have an issue providing a verifiable name and address before needing to list 50 plasma televisions or laptop computers.”

Sony is to make a second attempt to challenge Apple’s lead in the digital music download market and the Mac maker’s almost-ubiquitous iPod courtesy of the PlayStation Portable.
According to a Marketing magazine report, Sony Computer Entertainment Europe (SCEE) plans to launch a music service specifically for the PSP, which is expected to arrive in Europe and the US in March.

SCEE will put the delivery mechanism in place in time for the handheld console’s launch, using it to allow users to download game levels and software updates. However, the system will be extended to music in the summer.
Given the PSP’s multimedia focus, it’s entirely possible the service could subsequently be used to deliver video downloads.

Sony already runs a music download service, Connect. Launched in the US in May 2004 and in Europe in July, the service was criticised for failing to match the likes of Napster and Apple’s iTunes Music Store for easy of use. Certainly, the service does not appear to have grown to the extent that its rivals have, and Sony has said little about Connect in the intervening months.

Whether the PSP music service will leverage Connect or use an entirely separate system is not yet known.

Google Video Search

January 25th, 2005

Google Video Search

Well, you can search Frasier scripts. Now where’s my Monty Python Scriptbook….

Web Searchers miss blatant Ads

January 24th, 2005

Internet search engine users are an odd mix of naive and sophisticated, suggests a report into search habits.

The report by the US Pew Research Center reveals that 87% of searchers usually find what they were looking for when using a search engine.
It also shows that few can spot the difference between paid-for results and organic ones.

The report reveals that 84% of net users say they regularly use Google, Ask Jeeves, MSN and Yahoo when online.
Almost 50% of those questioned said they would trust search engines much less, if they knew information about who paid for results was being hidden.

According to figures gathered by the Pew researchers the average users spends about 43 minutes per month carrying out 34 separate searches and looks at 1.9 webpages for each hunt.

A significant proportion of net users, 36%, carry out a search at least weekly and 29% of those asked only look every few weeks.

For 44% of those questioned, the information they are looking for is critical to what they are doing and is information they simply have to find.
Search engine users also tend to be very loyal and once they have found a site they feel they can trust tend to stick with it.

According to Pew Research 44% of searchers use just a single search engine, 48% use two or three and a small number, 7%, consult more than three sites. Despite this liking for search sites half of those questioned said they could get the same information via other routes. A small number, 17%, said they wouldn’t really miss search engines if they did not exist.

The remaining 33% said they could not live without search sites. More than two-thirds of those questioned, 68%, said they thought that the results they were presented with were a fair and unbiased selection of the information on a topic that can be found on the net.

Alongside the growing sophistication of net users is a lack of awareness about paid-for results that many search engines provide alongside lists of websites found by indexing the web.

Of those asked, 62% were unaware that someone has paid for some of the results they see when they carry out a search. Only 18% of all searchers say they can tell which results are paid for and which are not.

Said the Pew report: “This finding is ironic, since nearly half of all users say they would stop using search engines if they thought engines were not being clear about how they presented paid results.”


84% of net users have used a search engine

44% use only one search engine

40% of men online search daily compared to 27% of women

62% are unaware of the difference between paid for and organic results

25% of searchers have looked themselves up on a search site

92% of searchers are confident in their searching

17% say they always find what they are looking for

68% consider search engines to be a fair and unbiased source

55% disapprove of search sites collecting information about them

Source: Pew Internet and American Life Project

Ebay profts fall

January 20th, 2005

Shares in online auction house eBay fell 12% in after-hours trade on Wednesday, after its quarterly profits failed to meet market expectations.

Despite seeing net profits rise by 44% to $205.4m (£110m) during October to December, from $142m a year earlier, Wall Street had expected more.

EBay stock fell to $91.01 in late trade, from a $103.05 close on Nasdaq.

EBay’s net revenue for the quarter rose to $935.8m from $648.4m, boosted by growth at its PayPal payment service.

Excluding special items, eBay’s profit was 33 cents a share, but analysts had expected 34 cents.

“I think Wall Street has gotten a bit ahead of eBay this quarter and for the 2005 year,” said Martin Pyykkonen, an analyst at Janco Partners.

For 2004 as a whole, eBay earned $778.2m on sales of $3.27bn.

EBay president and chief executive Meg Whitman called 2004 an “outstanding success” that generated “tremendous momentum” for 2005.

“I’m more confident than ever that the decisions and investments we’re making today will ensure a bright future for the company and our community of users around the world,” she said.

EBay now forecasts 2005 revenue of $4.2bn to $4.35bn and earnings excluding items of $1.48 to $1.52 per share.